The farther you get from the real events in time and space… and the grander the chutzpah of the events in question… the less likely they are to have any real meaning.

That is why local politics – as idiotic as they are – are still less gaudy and baroque than national politics. Bavaria didn’t invade Poland; Germany did.

Anne Arundel County, Maryland, didn’t come up with Obamacare; Congress (aided and abetted by thousands of industry insiders) did.

A local voter is too close to the facts to put up with much nonsense. He sees the humbuggery like a plumber sees a sewer: He knows how it works and knows what’s in it.

And he knows he will have to pay for it. He is also close enough to his leaders to see their flaws. He has never met one who wasn’t either an empty suit or an immodest jackass.

The “truth” is right in front of his eyes.

Losing Teeth

But today, the U.S. is no longer a confederation of states like Switzerland nor a modest republic like Finland or Argentina.

Like crystal meth, the thrill of empire got into it a long time ago. Now it can’t say no to the drug, even though it can’t stop scratching and its teeth are falling out.

An empire needs an emperor. Only a tiny percentage of the population will ever get to know him personally. But everyone is expected to care about what he does.

As we’ve explored in our “campfire tales” (catch up here and here), this has implications all up and down the line.

Empires follow different rules and different patterns. The average citizen has little knowledge of what goes on in the halls and broom closets of power… and little influence over them.

This leaves power in the hands of a special group of insiders – the Deep State.

Collectively, this group might see that the empire is headed for destruction. But individually, the foxes, zombies, and cronies who make up the Deep State have little incentive to change their behavior.

It is like a group of addicts all spending money from the same credit card. They may see that they are going broke, but no one wants to be the one to cut back.

Competing Factions

Over time, the insiders tend to sort themselves into competing factions.

The conservatives against the liberals… Republicans against Democrats… FBI against CIA… Congress against the White House… the military against Wall Street… and so forth.

Thus deadlocked by internal power struggles, the strongman leader – the emperor – grows taller… and more cunning.

No, he cannot change the fundamental direction of the society, its government, or its economy. That would put him at odds with the entire Deep State. But he can tip the balance in favor of one group of insiders over another.

That is why Mr. Donald J. Trump is perhaps the perfect leader for this period in America’s history. Neither “conservative” nor “liberal”… and unbounded by the Constitution, traditional party loyalty, or ideology… he is the man the empire needs.

He can promise carrots or threaten sticks. He can offer inducements and emoluments to one Deep State faction on Monday… and mistweet them on Tuesday.

He can rouse his supporters in Cleveland one day… and stab them in the back in Washington the next.

And day by day, the empire weakens. In a meth addict, the brain is the first to go. The heart, lungs, and liver follow.

Regards,

Bill

Further Reading: Now, over to our colleague at Casey Research for today’s Technology Insight.

This “sub-market” is 1/1000th the size of the S&P 500. Some heavy hitters have recently begun to enter it. Like billionaires Richard Branson, Peter Thiel, and LinkedIn co-founder and billionaire investor Reid Hoffman.

The Economist calls it “one of the world’s hottest investments.” Because the returns have been so high, you don’t need to bet the farm. In fact, you can get started with just 40 or 50 bucks.

—

Technology Insight

By CHRIS WOOD, Editor, Casey Extraordinary Technology

Editor’s Note: Chris Wood is the top technology analyst at Casey Research. Today, he shares a strategy that will show readers how to invest alongside new technologies without all the risk.

Investing in emerging technology can be tricky. It’s difficult to strike a balance between risk and reward.

You could invest in a startup that is all in on an emerging technology. If you pick a winner at this early stage, you’ll see big gains.

But if you pick a company that loses the technological race, you’ll see big losses.

Think of how BlackBerry lost the tech race to Apple’s iPhone. BlackBerry’s stock became almost worthless.

On the other hand, you could invest in a big company participating in an emerging tech market. For instance, chipmaker Intel recently got into the self-driving car technology.

This approach will lower your risk. But if the company is too big, the emerging tech may not be a major growth driver.

If that’s the case, you don’t really have a play on the emerging tech.

But there’s another option…

Behind Door Number Three…

You could invest in companies that aren’t totally dependent on the emerging technology they’re developing.

These companies have separate core products. They’re profitable and financially fit. They won’t implode if their new ventures don’t go well. And yet they are small enough to reap the rewards if the technology takes off.

Avago Technologies (now called Broadcom) is a prime example.

In 2010, Avago was a well-established company that sold computer chips to several markets.

But in 2010, it also started making LTE (4G) chips for Apple’s iPhone.

LTE is the technology that lets you browse the web from your phone while you’re on the go. And at the time, the technology was just taking off.

In 2010, sales of LTE-capable smartphones were virtually nonexistent. Today, they’re over a billion units per year.

As the tech took off, Avago’s share price jumped more than 1,000% in seven years.

Take a look at today’s chart…

Owning companies like Avago – that have diversified revenues – is an important part in any emerging tech investment strategy.

It allows you to pad your portfolio with safer opportunities. That way, you can take advantage of more speculative tech companies with big upsides…

— Chris Wood

P.S. In Extraordinary Technology, our portfolio is made up of financially sound companies that aren’t totally dependent on their emerging technology… as well as some more speculative opportunities with big upsides – like the one I recently discovered in biotech stocks.

In short, one obscure law has helped drive a small class of biotech stocks higher. Some of these companies have soared 1,000%, 2,000%, or more. And right now, another small company is set to profit from this law. You can learn more about this law right here.

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Mailbag

Your explanation of the win-lose deal is phenomenon and spot on. However, I have an additional category of person that exists on the “lose” side of that equation: the “brain dead” element.

A win-lose deal extracts an advantage (mostly monetary) from the loser to the winner. But “brain-dead” folks are so disconnected from reality that they actually support their own disadvantage by naively believing they’re getting a “good deal”.

Very, very sad and a large part of the “zombie” element.

– D. Fontana

Having had numerous conversations about what “money” is, I always refer to Black’s Law Dictionary (5th edition). In the definition, it clearly states that money “does not embrace notes, bonds, and evidences of debt.”

I then ask the individual I am conversing with to look at the paper in their wallet, any denomination, and see that it says, Federal Reserve “Note” at which time I ask them how much “money” they have. That usually ends the discussion.

– A.S.

People may vote for change, as Bill says, but they are actually voting for politicians who often promise change. Politicians may promise change, but when they succeed at the polls and come into office, they are faced with a “System,” “Deep State,” or whatever it may be called, which is corrupt, and which corrupts, absolutely.

This gang-like System has grown, little by little, ever since the Constitution was written and adopted, though it seems to have many “godfathers”. The System may give a little with one hand, but it takes even more with the other.

Any successful politician is corrupt. Just like in a gang, if a politician tries to fight the System, he or she is gotten rid of.

Join or die – politically at least.

– C. Burton

Meanwhile, the Diary’s sharp-eyed readers are quick to correct Bill on the analogy he used yesterday of a farmer in ancient Rome cultivating tomatoes.

Someone in ancient Rome was raising tomatoes? Please… tomatoes originated in the new world!

– A. Hemphill

Those ancient Romans sure got around. They even traveled to the Americas to get the first tomato plants.

– J. Bommer

In Case You Missed It…

The stock market has been on a tear this year, but almost nobody is paying attention to this little-known asset that is putting stock returns to shame.

It’s cryptocurrencies… And unlike traditional portfolios, you don’t need to invest thousands of dollars or wait several years to see incredible gains. Many investors started with a few hundred dollars and saw tenfold returns in months or even weeks.

Here’s the important part: The cryptocurrency revolution has just started. And our friends at the Palm Beach Research Group put together this video to show you how you can take advantage of this remarkable opportunity.